New Valley Corp. [Nasdaq: NVAL], a company that offered to provide bankrupt Globalstar with $55 million in debtor-in-possession (DIP) financing to gain majority control, failed in its bid to proceed with the arrangement Thursday when creditors unexpectedly rejected the offer.

The creditors opted instead to reach into their own pockets to provide Globalstar with roughly one-fifth the DIP financing that New Valley offered. The New Valley proposal, which had been arranged by Globalstar’s management, was voted on by creditors shortly before the U.S. Bankruptcy Court in Delaware was scheduled to take action on the offer, sources familiar with the situation said.

New Valley then terminated its agreement and left Globalstar to pursue discussions with other potential investors. Globalstar officials expressed confidence that another restructuring plan will be developed in the future.